Moved: This thread is more suitable in Linux-Newbie and has been moved accordingly to help your thread/question get the exposure it deserves.
Don't know the distro you're using. There's probably a graphical tool to add users, but they're distro-dependent. There's a console method: useradd command (you can read its' manual page by typing 'man useradd').
The problem with kernel probably means there's a module (driver) that doesn't load. But the kernel itself must be working bcause your system boots.
The most popular distributions are Mandrake, Redhat, SuSE, Slackware, Debian. First three are more for newbies, when the remaining two are for more advanced users (or newbies to Linux, but with good knowledgle of computers).